RBC Capital Markets cuts Dr Martens price target as it lowers estimates

RBC Capital Markets slashed its price target on Dr Martens on Monday to 150p from 180p, keeping the rating at ‘sector perform’, as it lowered estimates after the bootmaker’s results.

"FY24E may be characterised as a transitional year as DOCS makes necessary improvements to its business model including investments in supply chain, marketing and functions, wholesale distribution clean-up and right sizing inventory levels," RBC said.

"Demand outlook is mixed, however DOCS benefits from perimeter and channel mix tailwinds, providing some offset."

RBC said it views the equity set-up as balanced from a risk-reward perspective, particularly given materially lower FY24E earnings guidance.

The bank cut its estimates for FY24 EBITDA by 4%, EBIT by 13% and earnings per share by 15%, reducing the price target.